The UK has experienced a rise in employment rates and earnings growth in addition to the decrease in economic inactivity. This paints a largely positive picture, with women seeing their rates and earnings growth rising closer to men.
Today (16th July 2019), the Office for National Statistics Figures (ONS) released data which detailed changes in the labour market between March and May 2019 in comparison to previous years.
The data showed a rise in employment rates with 80 per cent of men and 72 per cent of women in employment during this time frame.
This indicates a 0.8 per cent increase in employment for women and a 0.1 per cent increase for men in comparison to the previous year.
This is the highest employment rate for women since comparable records began in 1971. The ONS attributed this peak to the changes in State Pension age for women which resulted in less women retiring between 60 and 65 years of age.
Naturally, unemployment followed a similar trend, seeing only 3.8 per cent of the UK unemployed, which is the lowest record since 1974. Again, the amount of women who are unemployed are at a record low, at only 3.6 per cent in March to May 2019.
Annual growth in average weekly earnings for employees in the UK has also increased to 3.4 per cent for total pay including bonuses and 3.6 per cent for regular pay.
When accounting for inflation, this becomes a 1.4 per cent increase for total pay and 1.7 per cent for regular pay.
However, despite these positive trends, the number of vacancies in the UK have actually decreased. Although the number of vacancies reached an all time high at the beginning of 2019, peaking at 861,000, this has since decreased to 827,000.
Tom Hadley, director of policy and campaigns at the Recruitment and Employment Confederation (REC), said:
Today’s ONS figures show a strong and robust labour market, with high employment and pay continuing to rise. The overall picture remains positive – an economy that provides opportunity to millions. This is good news but it should not be taken for granted.
The declining number of vacancies continues to act as a warning sign. Our own ‘Report on Jobs’ data shows a slight decline in permanent placements, as employer confidence and investment decisions remain stunted by Brexit uncertainty.
As we are set to see big changes at the top of government, the new PM and his cabinet must ensure that protecting and enhancing the UK jobs market is at the top of the agenda.
Gerwyn Davies, senior labour market analyst for the CIPD, the professional body for HR and people development, said:
It’s likely that the political uncertainty over the past six months has affected the confidence levels of recruiters given that the start of the year marked the turning point for the softening in employment growth.
Average weekly earnings for employees excluding bonuses have increased over the past year which will provide a further boost to the living standards of British workers. However, employers with low levels of productivity will face a hit to profits if they raise pay without seeking to improve productivity growth. The solution to the problem partly lies in improving management practices.